Gannina Srinivas, vs The Secretary To The Government,
2022 Latest Caselaw 676 AP

  THE HON'BLE SRI JUSTICE M.SATYANARAYANA MURTHY

               WRIT PETITION NO.15008 of 2019

ORDER:

One Gannina Srinivas and 20 others filed this petition under

Article 226 of the Constitution of India to issue a Writ of

Mandamus declaring the action of the respondents in continuing

all the petitioners in the regular posts as daily wage employees and

Contract Labour for long periods ranging from 11 years to 22 years

which is an unfair labour Practice as wholly arbitrary, highly

illegal, unjust and unconstitutional being violative of Articles 14,

16 and 21 of the Constitution of India and consequently direct the

respondents to regularise the services of the petitioners by making

them Permanent with all attendant benefits applicable for the

regular post such as Scale of Pay and other service conditions.

It is the case of the petitioners that the Electricity

Department was a Government Department and after enactment of

the Electricity Supply Act, 1948 the Andhra Pradesh State

Electricity Board was constituted. The State Government initiated

reforms in the electricity sector through the A.P. Electricity

Reforms Act, 1988 under which the AP State Electricity Board was

divided into two companies viz., AP TRANSCO and APGENCO in

the year 1999. Separate companies for distribution of the

electricity have been created in the year 2000 in the names of

Eastern Power Distribution Company Limited (APEPDCL), AP

Southern Power Distribution Company Limited (APSPDCL), AP

Central Power Distribution Company Limited (APCPDCL). The staff

working in A.P. State Electricity Board have been allotted to the

companies by virtue of settlements under Industrial Disputes Act,

1947 entered into with the employees unions as mentioned in MSM,J WP_15008_2019

Schedule-D of the AP Electricity Reforms Act, 1988. Till 1996, the

33/11 KV Sub-Stations which step-down the power received from

the 220 KV sub-stations were manned by the regular staff of the

electricity organization in the cadre of Linemen.

It is further contended that the electricity organization

recruits Junior Lineman directly and promotes them to Assistant

Lineman and thereafter to the Lineman cadre. The Linemen are

being appointed for manning the 33/11 KV Sub-Stations and they

are called Shift Linemen. As per Operational Subordinate Service

Rules, the qualification for appointment as Lineman is pass in 4th

Form (present day 9th class). The rules also allow temporary

appointments in case of urgency and in the circumstances stated

therein.

Each Sub Station is manned by 4 Operators i.e., 3 Operators

in 8 Hours Shift and the 4th Operator to work in holiday/leave

vacancy or in General Shift. The present qualification for Junior

Lineman is also pass in SSC and ITI (Electrical). The electricity

organization i.e., APSEB started employing substation operators on

contract basis by entering into L2 agreement with one of

the 4 workers since 1997 in few Sub Stations and petitioner No.1

is appointed on the same basis.

After creation of DISCOMS, tenders have been called for and

contractors have been asked to supply the sub-station operators

for maintenance of the sub-station. The duties assigned to the

outsourcing Sub Station Operators as well as permanent Shift

Linemen are the same. Despite change of contractors, the

petitioners continued to work uninterruptedly since the date of

their appointment till date. All the 21 petitioners have put in total MSM,J WP_15008_2019

service of more than 15 years (12 Petitioners); more than 12 years

(7 Petitioners) and more than 11 years (2 Petitioners). Thus all the

petitioners have completed more than 10 years of uninterrupted

service.

It is contended that since 1997, till today the electricity

organization is manning 33/11 KV Sub-Stations by allotting some

sub-stations to the permanent staff (by deploying Shift Lineman)

appointed under Operational Subordinate Service Rules and the

remaining sub-stations through Outsourcing Sub Station

Operators (for short ―OSSOs‖) employed through contractors. There

are 252 33/11 KV sub-stations in West Godavari District out of

which 43 are manned by permanent staff, whereas 209 sub-

stations are manned by OSSOs, whereas in East Godavari District,

19(Nineteen) 33/11 KV sub- stations are manned by permanent

staff and 178 sub-stations by OSSOs out of total 197 sub-stations.

The said fact of existence of 2 sets of Sub Stations was earlier

confirmed by the respondents under the Right to Information Act.

It is further contended that all the petitioners are workmen

and the establishment i.e., APEPDCL in which they are working is

an ―industry‖ as defined in the Industrial Disputes Act, 1957. This

was held by various decisions of this High court and the Supreme

Court and reiterated recently in the Division Bench Judgment

dated 18.09.2018 in W.P.No.20544 of 2017 and W.P.(PIL) No.149

of 2017 of the High Court of Andhra Pradesh at Hyderabad. Some

of the petitioners are appointed by giving L2 agreement in the

name of one of the 4 workmen which is nothing but a direct

employment and subsequently converted them as contract labour

by appointing contractors.

MSM,J WP_15008_2019

It is further contended that the shift linemen who are

permanent employees and the outsourcing sub-station operators

discharge the same set of duties as per the chart exhibited in each

of the sub-stations. As per Section 2 (ra) of the Industrial Disputes

Act, ―Unfair Labour Pratice‖ means any practices specified in the

Fifth Schedule. Item No. 1 - 10 of the Schedule-V of the Industrial

Disputes Act, 1947 reads as:

―To employ workmen as badalies, casuals or temporaries and to continue them as such for years, with the object of depriving them of the status and privileges of permanent workmen.‖

As per Section 25 T, no employer or workman or a trade

union shall commit any unfair labour practice. Section 25 U

provides for penalty for committing unfair labour practices.

The AP Contract Labour Union (Regd. No.B 1996) raised

several disputes before the Labour Department for implementation

of service conditions applicable under various labour laws and

after long struggle for more than 15 years, only some of the

statutory service conditions are being implemented. The A.P.

Contract Labour Union submitted representation dated 10.03.2014

regarding implementation of Statutory Benefits and treating the

Contract Labour as Departmental workers with no extra cost. As

there is no response from the Authorities, the Union filed Writ

Petition No.15154 of 2014 before the High Court at Hyderabad and

the Court was pleased to dispose of the Writ Petition by Orders

dated 06.06.2014 with a direction to the respondents to consider

the representation dated 10.03.2014 and to take appropriate

decision thereon, as expeditiously as possible, at any rate within a MSM,J WP_15008_2019

period of twelve (12) months from the date of receipt of a copy of

the order. But, no action has been taken by the respondents.

The A.P.Contract Labour Union also filed the following

claims for minimum wages and continuing the struggle as the

respondents are dragging the litigation for years together depriving

the outsourced sub-station operators of even the minimum

statutory service conditions and facilities like minimum wages,

leave, national and festival holidays etc.,

1. Payment of Wages Claim No.22/2009 for Rs.6,74,900/- in

respect of Sub Station Operators in West Godavari District. The Claim was allowed by the Authority under Payment of Wages of Act, 1926 and Joint Commissioner of Labour, Eluru, for Rs.6,74,900/- and the Management filed W.P.No.4000/2010 which is pending before this Court.

2. Payment of Wages Claim No.4/2011 for Rs.75,19,492 in respect of Sub Station Operators in West Godavari District. The Claim was allowed by the Authority under Payment of Wages of Act, 1926 and Joint Commissioner of Labour, Eluru, for Rs.75,19,492. Management filed Appeal before the Appellate Authority and District Judge upheld the Lower Court Order. The claim amount is pending before the Authority.

3. Payment of Wages Claim No.3/2011 for Rs.1,51,85,201/- in respect of Sub Station Operators in East Godavari District. The Claim was allowed by the Authority under Payment of Wages of Act, 1926 and Joint Commissioner of Labour, Eluru. The Management filed W.P.No.27473/2012 which is pending before this Court.

The Industrial Employment (Standing Orders) Act, 1949 is

applicable for the APEPDCL as it is an ―industrial or other

establishment‖ as defined in Section 2 (ii)(g) of Payment of Wages

Act, 1936 and hence covered by Section 1(2) read with Section 2(e)

of the Industrial Employment (Standing Orders) Act, 1949. As per

the model standing orders (which has mandatory application, MSM,J WP_15008_2019

when there are no certified standing orders), the employees may be

classified as (a) permanent (b) probationers (c) badlies or

substitutes (d) temporary workmen (e) casual workmen (f)

apprentices and (g) seasonal workmen.

The electricity organization i.e., APSEB or the APEPDCL are

within their competence to appoint the contract or outsourced

sub-station operators for a temporary period and it is neither

irregular nor illegal appointment. However continuing them years

together as such is an unfair labour practice, as per the Industrial

Disputes Act, 1947. Further even if the petitioners are to be treated

as contract labour as per Rule 25(v)), they are entitled for same

service benefits on par with the regular workmen.

The maintenance of sub-station is a core activity of the

respondent organisation and the petitioners are working under the

direct control and directions of the respondents as per the work

chart, and they are working, despite change of contractors since

their initial date of appointment till today; their initial entry is

neither irregular nor illegal as the rules permit such temporary

appointment and they are qualified at the time of recruitment, they

are entitled for regularisation, requested to grant relief as claimed

in the writ petition.

Respondent No.9 filed counter denying the material

allegations while contending that the writ petition is not

maintainable as the respondents have not violated or infringed any

constitutional or statutory right of the petitioners.

It is contended that petitioner No.17 is working in

Sub-Station Lakkavaram, Malikipuram and petitioner No.18 is

working in Sub-Station as shift operator under the contractor i.e. MSM,J WP_15008_2019

respondent No.14 herein . These two substations fall under the

division of respondent No.9 herein. The Eastern Power Distribution

Company limited issued a notification for recruitment of energy

assistants (Junior Lineman Gr-11) to work in the village

secretariats/Ward Secretariats established in the Gram

Panchayats/Wards as per G.O.Ms.No.110, Panchayat Raj and

Rural Development (MDL-1) department dated 19.07.2019 and

G.O.Ms.No.217 MA & UD (UBS) Department dated 20.07.2019.

Respondent No.9 recruited 583 persons in Rajamahendravaram

Circle, out of which 90 persons were recruited under Amalapuram

Division. The qualification for the posts as per notification

SSC/10th class with ITI qualification in electrical Trade/Wireman

trade or intermediate vocational course in Electrical Domestic

Appliances and Rewinding (EDAR) and Electrical Wiring and

contracting (EWC) on par with Electrical Wiring and Servicing of

Electrical Appliances (EW&SEA) from a recognized

Institution/Board.

It is contended that as per the notification of the above posts

the service contract workers who have been working in

organizations of in AP DISCOMS were given weightage marks to a

maximum of 20, depending on the length of service of AP

DISCOMS @ 1 mark per every six months (180) days upto the date

of notification dated 29.07.2019. As such the service contract

workers were also recruited in service. These petitioners were not

qualified as per the notification though weightage was given to

them.

It is further contended that petitioner Nos.17 and 18 are

working under various contractors like respondent Nos.12 to 15 MSM,J WP_15008_2019

but not under respondent Nos.1 to 11 and the salaries paying by

the contractors. Hence, respondent Nos.1 to 11 are no way

concerned with regard to the payment of wages or salaries.

APEPDCL issued notification for supply of manpower to maintain

substations round the clock, specifying that the contract may be

extended for another year and the contract is not at all is on

permanent basis. There is no master and servant relation between

the contractor and the APEPDCL, and the EPDCL is not a profit

organization under Section 8 of the Companies Act. In fact, the

Discom calculating the amount of the contractor basing on the

minimum wages as fixed by the labour department. Therefore, the

contention of the petitioner is not at all correct, as the company is

not undertaking, not allowing unfair labour practice at any

circumstances as it is a non-profitable organization.

It is further contended that the respondents never denied the

legitimate and legal rights of the petitioners, requested to dismiss

the writ petition.

Sri Y.Surya Prasad, learned counsel for the petitioners,

would contend that continuation of petitioners as employees under

the contractor is a serious violation of right of employees and

though the petitioners were engaged by the contractor, they are

under both supervisory and financial control of principal employer

i.e. respondent Nos.4 and 5. Therefore, continuation of their

service on contract basis for such a long time is contrary to the

various principles laid down by the Apex Court in the judgments

he relied on, which will be referred at appropriate stage. The

services of the petitioners are engaged on payment of meagre

salary, which is not sufficient to meet both ends and that apart, MSM,J WP_15008_2019

the petitioners are discharging their duties on par with regular

employees, but they were not extended minimum time scale of pay,

which is contrary to the principle of ―equal pay for equal work‖.

Therefore, the petitioners are entitled to claim at least ―equal pay

for equal work‖ on par with regular employees, but they are being

paid minimum. Hence, the petitioners are requested to issue a

direction to the respondents to regularise their services in the

department and pay salary from the date of their appointment on

par with regular employees.

Learned counsel for the petitioners filed written arguments.

Sri Metta Chandra Sekhar Rao, learned counsel for

respondent No.9, submitted that there is no relationship of

employer and employee between the respondents and the

petitioners, thereby this Court while exercising power under Article

226 of the Constitution of India cannot decide the dispute between

the employees engaged by the contractor. Thus, this Court has no

jurisdiction to decide the dispute between the contractor and the

petitioners regarding the salary and regularisation of their service

invoking jurisdiction under Article 226 of the Constitution of India.

It is further contended that when there is no relationship of

employer and employee between the respondents and the

petitioners, the respondents are not under obligation to regularise

the services of the petitioners as they were not appointed by

respondent Nos.4 to 9, but their services were engaged by

respondent Nos.12 to 15, thereby the grievance of the petitioners is

outside the purview of jurisdiction of this Court under Article 226

of the Constitution of India. Therefore, the petitioners are not

entitled to claim any relief in the writ petition. Since the petitioners MSM,J WP_15008_2019

were not appointed by following regular procedure of selection of

employees under respondent Nos.4 to 9, their services cannot be

regularised even according to the judgment, relied on by

petitioners, rendered by the High Court of Andhra Pradesh at

Hyderabad in W.P.No.20544 of 2017 and W.P (PIL) No.149 of 2017,

thereby the petitioners are not entitled to any relief, requested to

dismiss the writ petition.

Considering rival contentions, perusing the material

available on record, the points need to be answered by this Court

are as follows:

(1) Whether the petitioners are contract employees engaged by respondent Nos.4 to 9? If not, whether this Court can entertain writ petition under Article 226 of the Constitution of India to decide the dispute between the contractor and the petitioners regarding regularisation and payment of salary etc.?

(2) Whether the petitioners are appointed by following regular procedure for selection of employees? If so, whether their services be regularised in the office of respondent Nos.4 to 9?

(3) Whether the petitioners are entitled to claim minimum pay scale on par with regular employees, who are discharging similar duties?

P O I N T Nos.1 and 2:

Since the dispute revolving around the nature of employment

of the petitioners, it is appropriate to advert to the definition of

contract employee, workmen etc. as defined in the Contract Labour

(Regulation and Abolition) Act, 1970 (for short ―Act No.37 of 1970‖).

MSM,J WP_15008_2019

The definitions of ―contract labour‖, ―contractor‖ ―principal

employer‖, ―workman‖ are defined under Section 2 (b) of the Act

No.37 of 1970, which is as follows:

(b) a workman shall be deemed to be employed as ―contract labour‖ in

or in connection with the work of an establishment when he is hired in or

in connection with such work by or through a contractor, with or without

the knowledge of the principal employer;

(c) ―contractor‖, in relation to an establishment, means a person who

undertakes to produce a given result for the establishment, other than a

mere supply of goods of articles of manufacture to such establishment,

through contract labour or who supplies contract labour for any work of

the establishment and includes a sub-contractor;

(g) ―principal employer‖ means--

(i) in relation to any office or department of the Government or a local

authority, the head of that office or department or such other officer as the

Government or the local authority, as the case may be, may specify in this

behalf,

(ii) in a factory, the owner or occupier of the factory and where a

person has been named as the manager of the factory under the Factories

Act, 1948 (63 of 1948), the person so named,

(iii) in a mine, the owner or agent of the mine and where a person has

been named as the manager of the mine, the person so named,

(iv) in any other establishment, any person responsible for the

supervision and control of the establishment.

Explanation.--For the purpose of sub-clause (iii) of this clause, the

expressions ―mine‖, ―owner‖ and ―agent‖ shall have the meanings

respectively assigned to them in clause (j), clause (l) and clause (c) of sub-

section (1) of section 2 of the Mines Act, 1952 (35 of 1952);

(i) ―workman‖ means any person employed in or in connection

with the work of any establishment to do any skilled, semi-skilled or un-

skilled manual, supervisory, technical or clerical work for hire or reward, MSM,J WP_15008_2019

whether the terms of employment be express or implied, but does not

include any such person--

(A) who is employed mainly in a managerial or administrative capacity;

or

(B) who, being employed in a superviory capacity draws wages

exceeding five hundred rupees per mensem or exercises, either by the

nature of the duties attached to the office or by reason of the powers

vested in him, functions mainly of a managerial nature; or

(C) who is an out-worker, that is to say, a person to whom any articles

or materials are given out by or on behalf of the principal employer

to be made up, cleaned, washed, altered, ornamented, finished,

repaired, adapted or otherwise processed for sale for the purposes of the

trade or business of the principal employer and the process is to be carried

out either in the home of the out-worker or in some other premises,

not being premises under the control and management of the principal

employer.

(2) Any reference in this Act to a law which is not in force in the State

of Jammu and Kashmir shall, in relation to that State, be construed as a

reference to the corresponding law, if any, in force in that State.

In view of the definition of ―contract labour‖ under the Act

No.37 of 1970, when a person is hired in or in connection with

such work by or through a contractor, with or without the

knowledge of the principal employer.

Here, the petitioners were engaged through a contractor,

therefore they are claiming to be contract labour as defined under

Section 2 (b) of the Act 37 of 1970.

According to the contention of the respondents, the

petitioners were not engaged as workmen/contract labour through

contractor, but the maintenance work was entrusted to the

contractor. Therefore, the petitioners would not fall within the MSM,J WP_15008_2019

definition of contract labour as defined under Section 2 (b) of the

Act No.37 of 1970.

In view of the rival contentions with regard to nature of

employment of the petitioners and their engagement, it is

necessary to advert to the agreement between the contractor and

respondent Nos.4 to 9. Copy of such agreement is placed on record

before this Court along with the details of employees i.e.

petitioners.

As seen from the statement showing details of sub-station

operators, the names of the employees, controlling authority details

on the date of their appointment, service conditions and the names

of the contractors were furnished by the petitioners. Thus, the said

details are suffice to conclude that the services of the petitioners

were engaged by contractor shown in column meant for ‗present

contractor name'.

As the services of the petitioners were engaged by the

contractor under the alleged agreement, they would not fall within

the definition of ‗contract labour' since they were not engaged by

respondent Nos.4 to 9 through a contractor and there was no

contract of employment between the petitioners and respondent

Nos.4 to 9 specifying the conditions of service. Form of

L.S.Agreement is placed on record by the petitioners executed by

G.Srinivas, Contractor, Nallazarla and Divisional Electrical

Engineer, Operation, Eluru. The nature of work entrusted to the

contractor is to attend operation and maintenance work at 33/11

KV Singarajupalem sub-station, on contract basis for the period

01.12.2018 to 31.03.1999 i.e. 121 days for consideration of MSM,J WP_15008_2019

Rs.36,300/- subject to certain terms and conditions of the work

and special conditions, which are as follows:

Terms and Conditions of the work

(1) The shift duty batch should work 8 hours per shift in each day.

(2) Each shift will have: 1 No. I.T.I. person.

(3) One general shift batch with one helper (i.e. I.T. I person) will be for relief shifts and also for carrying out general maintenance works at sub-station as per A.P.S.E.B. Norms

(4) The shift duty batch should operate the equipments at the substation as per the operating instructions supplied to them and also as per the instructions of officer incharge of the sub-stations is any mal-operations are conducted without any instructions from the Board officials the loss or damage sustained to the Board's equipment due to negligence of the persons employed by the contractor, the amount of 1oss will be recovered from the contractor.

(5) Weekly Offs, to the persons engaged in shift duties should be given arranging general person in shift duties.

(6) Safety appliances and required T&P to work as per the departmental standards will be supplied by the Board.

(7) The Board is not responsible for any accident to the persons (shift duty persons)

(8) The payment will be made based on the satisfactory certificate issued by the concerned officer incharge of the substation.

(9) The contractor should ensure the staff working at 33/11 KV substation covering under work man compensation Act as applicable and produce the insurance policy of each such workman are engage.

(10)The contractor is alone responsible for ensuring implementation of provisions of contract labour Arbitration Act, and other provision of various labour rules in force connected to the contract labour and for maintenance of required registers and records.

(11)The contractor is alone responsible for safe working of workmen working at the substation on duty and also to ensure strict compliance of provision of safety code and safety rules, with all required safety precautions for safe working of workmen.

(12)The contractor alone is liable to pay any liabilities that may be ensured the workmen engaged by him the terms relevant/rules in force relating to contract labour.

(13)The APSEB is at liberty to reject the statutory obligations vested with the principle employee in the event of contractor fails to violate the statutory MSM,J WP_15008_2019

provisions covered under various labour Acts to meet the ends of justice to the workmen.

(14)It is the responsibility of contractor to ensure safety of Boards property including equipment etc. at SS and he will be responsible for the damages Covered if any to the Dept./Property and the cost of such has to be borne by the contractor only.

Special Conditions:

(1) Necessary T&P items such as spanners, hammers etc., and consumables like Mabile rope etc., necessary for the work should be produced by contractor himself.

(2) The contractor is wholly responsible for the welfare and proper working of the labour employees. The contractor will be governed by workmen's compensation Act 1923 and he should follow all existing labour acts and rules.

3) The entire works shall be completed within a period 121 days from the date of starting or work.

4) Any loss of materials and Equipment of the Department will be recovered from the contractor from time contractor's bills.

5) Any dispute arising out of the contract shall be settled in the court of law situated at Eluru.

6) Any damage done to the Government/ Board property shall be made from the contractor.

The said L.S. Agreement is silent as to whom the contractor

has to engage the services of any person except prescribing the

qualification to such employee engaged by Contractor for

maintenance of sub-station requires both skilled and semi skilled

persons since electricity generation and supply is a dangerous

trade.

The contract was between the contractor and the department

only for maintenance. It is for the contractor to engage the services

of any person, but he must fulfil the qualification prescribed in the

contract. The department has no direct control over some of the

petitioners as their services were engaged by the contractor under

the L.S. agreement referred above. Therefore, absolutely, there is

no direct connection between the petitioners and respondent Nos.4 MSM,J WP_15008_2019

to 9, such L.S.agreement does not create the relationship of

employee and employer between the petitioners and respondent

Nos.4 to 9, at best, they are the employees under the contractors

i.e. respondent Nos.12 to 15. Therefore, in the absence of any

relationship of employer and employee either regular, contract,

outsourcing basis, the Court cannot entertain a writ under Article

226 of the Constitution of India. Sri Metta Chandra Sekhar Rao,

learned counsel for respondent No.9, vehemently contended that

when there is no relationship of employee and employer, the Court

cannot decide their disputes by entertaining writ under Article 226

of the Constitution of India, placed reliance on ―Dena Nath v.

National Fertilisers Limited1‖. In the said judgment, the

Supreme Court while considering the Contract Labour (Regulation

and Abolition) Act, 1970 observed that the said Act serves two-fold

purposes (1) regulation of the conditions of service of the workers

employed by the contractor who is engaged by a principal employer

and; (2) also provides for the appropriate Government abolishing

contract labour altogether, in certain notified processes, operation

or other works in any establishment. Neither the Act nor the Rules

framed by the Central Government or by any appropriate

Government provide that upon abolition of contract labour, the

said labour would be directly absorbed by the principal employer.

It is further observed that in appropriate cases in industrial

adjudication appropriate directions can be given to the principal

employer in this behalf and that in proceedings under Article 226

of the Constitution merely because contractor or the employer had

violated any provision of the Act or the rules, the Court could not

(1992) 1 SCC 695 MSM,J WP_15008_2019

issue any mandamus for deeming the contract labour as having

become the employees of the principal employer.

Finally, the Supreme Court held as follows:

It is not for the High Court to inquire into the question and decide whether the employment of contract labour in any process, operation or in any other work in any establishment should be abolished or not. It is a matter for the decision of the Government after considering the matter, as required to be considered under Section 10 of the Act. The only consequences provided in the Act where either the principal employer or the labour contractor violates the provision of Sections 9 and 12 respectively is the penal provision, as envisaged under the Act for which reference may be made to Sections 23 and 25 of the Act. We are thus of the firm view that in proceedings under Article 226 of the Constitution merely because contractor or the employer had violated any provision of the Act or the rules, the Court could not issue any mandamus for deeming the contract labour as having become the employees of the principal employer.

Similar view is taken by the learned single Judge of this

Court in W.P.Nos.12035, 12154 and 11898 of 2021 dated

05.08.2021, held that the Court cannot decide the issue between

the employees engaged by the contractor and the contractor in the

similar circumstances. In view of these principles laid down in the

above two judgments, this Court cannot decide the dispute

pending between the employees engaged by the contractor and the

contractor, such reference is to be made to the Government as held

by the Apex Court in ―Dena Nath v. National Fertilisers

Limited‖ (referred supra).

The entire documentary evidence produced by the petitioners

along with the writ petition and allegations made in the writ

affidavit clinchingly establish that their services were engaged by

respondent Nos.12 to 15 and there is no direct relationship of MSM,J WP_15008_2019

employee and employer between the petitioners and respondent

Nos.4 to 11.

Even if the tests for determining nature of contract are

applied, the petitioners failed to satisfy those tests. The first test is

Supervision and Control, second test is Economic Control and the

third test is Twin Test.

Except the first test i.e. test of supervision, the petitioners

were not under the control of respondents. Since the TRANSCO is

dealing with dangerous trade i.e. supply of electricity, the persons

working therein under the constant supervision to avoid untoward

incident. Therefore, the work of the petitioners is being supervised

by the highly skilled officers of the respondents and mere

supervision on the petitioners by itself is not sufficient to create

any relationship of employer and employee. The petitioners did not

satisfy any other tests to prove direct relationship between them

and the respondents and the Apex Court succinctly held that the

Supervision Test and Economic Control are not the determining

factors to decide the relationship of employee and the employer.

The Apex Court held that two well-recognised tests are

whether: (i) principal employer pays salary instead of contractor,

and (ii) principal employer controls and supervises work of

employee.

Applying the said test in ―Shining Tailors v. The

Industrial Tribunal2" the Apex Court observed that

supervision and control test was more suited to an agricultural

society prior to Industrial Revolution and during the last few

1983 Lab. IC 1509 MSM,J WP_15008_2019

decades the emphasis in the field has shifted and no longer rests

exclusively or strongly on the question of control.

Therefore, the Supervision and Control test has created more

confusion, the level of supervision and control required to form a

master-servant relationship is a question of fact which exist to this

day. But, later the economic control is to be one of the factors to

decide the relationship, but ultimately due to passage of time, the

twin tests are prescribed in ―Bengal Nagpur Cotton Mills v.

Bharat Lal3" wherein it was observed that two of the well-

recognized tests to find out whether the contract labourers are the

direct employees of the principal employer are (i) Whether the

principal employer pays the salary instead of the contractor, and;

(ii) Whether the principal employer controls and supervises the

work of the employee.

Coming to the twin test, it is satisfied partly i.e. test of

supervision, but the petitioners failed to establish the second test

i.e. economic test. Thereby, the petitioners failed to establish the

relationship of employer and employee between the respondents

and the petitioners satisfying any of the tests referred above except

satisfying part of the test, that by itself is not sufficient to create

relationship of employee and employer between the petitioners and

the respondents.

As discussed above, there is no direct or indirect relationship

of employee and employer between the petitioners and the

respondents, but their services were engaged by respondent Nos.12

to 15

(2011) 1 SCC 635 MSM,J WP_15008_2019

In view of my foregoing discussion, I find that the petitioners

miserably failed to establish the relationship of employee and

employer between the petitioners and the respondent Nos.4 to 11.

Consequently, the dispute relating to regularisation of the services

of the petitioners cannot be decided by this Court while exercising

power under Article 226 of the Constitution of India.

Sri Y.Surya Prasad, learned counsel for the petitioners,

would contend that the petitioners were engaged by the

maintenance contractor entering into L.S. agreement between the

respondent Nos.4 to 11 and respondent Nos.12 to 15, but the

petitioners are not parties to the agreement, but their services were

engaged by the contractor, who entered into agreement for

maintenance of sub-station, as such engaging such employees

through contractor by respondent Nos.4 to 11 is nothing but

camouflaging process of appointment and such practice cannot be

allowed, thereby the petitioners are entitled for regularisation since

respondent Nos.4 to 11 are principal employers. In support of his

contention, he placed reliance on the judgment of the Division

Bench of the High Court of Andhra Pradesh in ―P.Anil Kumar v

CMD, TS Genco (W.P.No.20544 of 2017 and W.P. (PIL).No.149 of

2017)‖.

In the facts of the above judgment, several persons were

engaged through the outsourcing agencies and the issue was taken

up by 14 Trade Unions operating in the power sector in the State of

Telangana. The 14 Trade Unions are said to have formed

themselves into a Federation known as Telangana Electricity Trade

Unions Front and issued strike notice, thereafter they entered into MSM,J WP_15008_2019

agreement with Transmission Corporation for regularisation of

services of 23,667 workers, who were employed on outsourcing

basis. The same was challenged by 3rd parties in Public Interest

Litigation (PIL) and in the said PIL, the Transmission Corporation

resiled from the agreement to absorb several workers engaged by

the department. But the Division Bench of the High Court of

Andhra Pradesh concluded that it is not even a scheme under

which the workmen employed through outsourcing agencies are

sought to be absorbed. It is out of a statutory compulsion that the

situation on hand has arisen. The industrial dispute raised by the

Federation of Trade Unions had led to a settlement first under

Section 18 (1) followed by a settlement under Section 12 (3) in the

course of conciliation proceedings. The managements of the

respondents - Corporations cannot now go back on the settlement

and the settlement cannot be set at naught at the instance of third

parties. Thus, the fact situation in the present case and the said

judgment is totally different and it is only in the conciliation

proceedings they entered into agreement for absorption though it is

not out of statutory compulsion. But, here no such agreement was

entered into for absorption of any of the petitioners. Therefore, the

principle laid down in the above judgment is of no avail to the

petitioners.

Learned counsel for the petitioners also relied on another

judgment of the Supreme Court in ―Chemical Mazdoor Panchayat

v. Indian Oil Corporation Limited (Civil Appeal No (s).1074 of

2017)‖. The issue involved in the above judgment is with regard to

regularisation of employees. In the facts of the above judgment, the

High Court has observed that the workers employed by the MSM,J WP_15008_2019

contractor cannot be compared with the employees who have

worked in Five Star Hotels. The Supreme Court held that the

observation of the High Court is not legally permissible in which

the High Court should have approached the case, particularly with

respect to spirit of Rule 25 (2) (v) (a) of the Contract Labour

(Regulation and Abolition) Central Rules, 1971. In India, there are

haves and have-nots, poor workers and proletariat have equal

rights. The approach of the High Court is discriminatory and

impermissible classification has been made and has no co-relation

with respect to equal protection as envisaged constitutionally.

Taking advantage of the above judgment, it is contended by

the learned counsel for the petitioners that the petitioners were

engaged by the Contractor and they are also entitled for

absorption. The principle laid down by the Supreme Court in the

said judgment cannot be applied straight away for the reason that

there was no relationship of employee and employer between the

petitioners and the respondents and at best, they may approach

the competent industrial tribunal to redress their grievance, but

such exercise cannot be undertaken by this Court while exercising

jurisdiction under Article 226 of the Constitution of India.

Learned counsel for the petitioners further drawn the

attention of this Court to the judgment of the Supreme Court in

―State of Rajasthan v. Shiv Charan Meena (Civil Appeal No.5747 of

2021 (arising out of SLP (Civil) No.27737 of 2018)‖, wherein the

post of Driver in the Agriculture Department of the State

Government at the relevant time was occupied by one Lalu Ram

Meena, whose services were regularized with effect from MSM,J WP_15008_2019

16.10.2002. However, since said Lalu Ram Meena was sent on

deputation, services of Shiv Charan Meena, respondent therein,

were engaged on contract basis though Jaipur Ex-Servicemen

Welfare Cooperative Society. The services of the Shiv Charan

Meena were disengaged after said Lalu Ram Meena was repatriated

to the concerned department. In the said case, the services of the

respondent therein were engaged directly by the department. But

in the present case, the services of the petitioners were not

engaged by respondent Nos.4 to 11 on contract basis, but engaged

by respondent Nos.12 to 15. Consequently, the principle laid down

in the said judgment has no relevance to the present facts of the

case.

In ―Ram Manohar Lohia Joint Hospital v. Munna Prasad

Saini4‖ the award passed by the Labour Court has reached the

Supreme Court in regard to the regularisation of employees. In the

said case, after conducting enquiry Industrial Tribunal or Labour

Court passed an award, which was set aside by the High Court.

But the Supreme Court restored the same, held that the

appointment of the first Respondent was on contractual basis and

not to a regular post on proper selection in terms of the rules.

Pertinently, the Respondent has not indicated his educational

qualifications and whether he has necessary qualifications to work

as a nurse or a ward boy. It is also obvious that the contractual

term was over.

In ―Deputy Executive Engineer v. Kuberbhai Kanjibhai5‖,

the Apex Court had referred to several earlier judgments and had

AIR 2021 SC 4400

(2019) 4 SCC 307 MSM,J WP_15008_2019

quoted with approval of the ratio as expounded in ―Bharat

Sanchar Nigam Limited v. Bhurumal6‖, to the following effect:

―33. It is clear from the reading of the aforesaid judgments that the ordinary principle of grant of reinstatement with full back wages, when the termination is found to be illegal is not applied mechanically in all cases. While that may be a position where services of a regular/permanent workman are terminated illegally and/or mala fide and/or by way of victimisation, unfair labour practice, etc. However, when it comes to the case of termination of a daily-wage worker and where the termination is found illegal because of a procedural defect, namely, in violation of Section 25-F of the Industrial Disputes Act, this Court is consistent in taking the view that in such cases reinstatement with back wages is not automatic and instead the workman should be given monetary compensation which will meet the ends of justice. Rationale for shifting in this direction is obvious.

34. The reasons for denying the relief of reinstatement in such cases are obvious. It is trite law that when the termination is found to be illegal because of non-payment of retrenchment compensation and notice pay as mandatorily required Under Section 25-F of the Industrial Disputes Act, even after reinstatement, it is always open to the management to terminate the services of that employee by paying him the retrenchment compensation. Since such a workman was working on daily-wage basis and even after he is reinstated, he has no right to seek regularisation [see State of Karnataka v. Umadevi]. Thus when he cannot claim regularisation and he has no right to continue even as a daily-wage worker, no useful purpose is going to be served in reinstating such a workman and he can be given monetary compensation by the Court itself inasmuch as if he is terminated again after reinstatement, he would receive monetary compensation only in the form of retrenchment compensation and notice pay. In such a situation, giving the relief of reinstatement, that too after a long gap, would not serve any purpose.

35. We would, however, like to add a caveat here. There may be cases where termination of a daily-wage worker is found to be illegal on the ground that it was resorted to as unfair labour practice or in violation of the principle of last-come-first-go viz. while retrenching such a worker daily wage juniors to him were retained. There may also be a situation that persons junior to him were regularised under some policy but the workman concerned terminated. In such circumstances, the terminated worker should not be denied reinstatement unless there are some other weighty reasons for adopting the course of grant of compensation instead

(2014) 7 SCC 177 MSM,J WP_15008_2019

of reinstatement. In such cases, reinstatement should be the Rule and only in exceptional cases for the reasons stated to be in writing, such a relief can be denied.‖

The said principle cannot be applied to the present facts of

the case, at best, the petitioners may approach the Industrial

Tribunal or Labour Court for appropriate relief, but such exercise

cannot be undertaken by this Court while exercising jurisdiction

under Article 226 of the Constitution of India.

None of the judgments relied on by the learned counsel for

the petitioners are applicable to the present facts of the case, but

in the written arguments, learned counsel for the petitioners

referred several other judgments, more particularly in ―Jacob M.

Puthuparambil v. Kerala Water Authority7‖, wherein the Apex

Court held as follows:

―India is a developing country. It has a vast surplus labour market. Large-scale unemployment offers a matching opportunity to the employer to exploit the needy. Under such market conditions the employer can dictate his terms of employment taking advantage of the absence of the bargaining power in the other. The unorganised job seeker is left with no option but to accept employment on take-it-or-leave-it terms offered by the employer. Such terms of employment offer no job security and the employee is left to the mercy of the employer. Employers have betrayed an increasing tendency to employ temporary hands even on regular and permanent jobs with a view to circumventing the protection offered to the working classes under the benevolent legislations enacted from time to time. One such device adopted is to get the work done through contract labour.

It is in this backdrop that we must consider the request for regularisation in service.‖

In ―Indian Petrochemicals Corporation Limited v.

Shramik Sena8‖ the Apex Court while dealing with the issue of

AIR 1990 SC 2228

AIR 1999 SC 2577 MSM,J WP_15008_2019

regularisation of contract labour working in Statutory Canteen

(permanent and perennial nature) held as follows:

That apart, a perusal of the affidavits filed in this Court and the contract entered into between the management and the contractor clearly establishes:

(a) The canteen has been there since the inception of the appellant's factory.

(b) The workmen have been employed for long years and despite change of contractors the workers have continued to be employed in the canteen.

(c) The premises, furniture, fixture, fuel, electricity, utensils etc, have been provided for by the appellant.

(d) The wages of the canteen workers have to be reimbursed by the appellant.

(e) The supervision and control on the canteen is exercised by the appellant through its authorised officer, as can be seen from the various clauses of the contract between the appellant and the contractor.

(f) The contractor is nothing but an agent or a manager of the appellant, who works completely under the supervision, control and directions of the appellant.

(g) The workmen have the protection of continuous employment in the establishment.

27. Considering these factors cumulatively in addition to the fact that the canteen in the establishment of the management is a statutory canteen, we are of the opinion that in the instant case, the respondent- workmen are in fact the workmen of the appellant-management.‖

But in the present case, the petitioners were not engaged by

respondent Nos.4 to 11 directly, thereby it is difficult to accept the

contention of the learned counsel for the petitioners applying the

principle laid down in the above judgment since the members of

Shramik Sena were directly engaged by the Indian Petrochemicals

Corporation Limited, as such there was relationship of employee MSM,J WP_15008_2019

and employer between the members of Shramik Sena and Indian

Petrochemicals Corporation Limited.

Learned counsel for the petitioners also relied on the

judgment of the Calcutta High Court in ―ONGC Mazdoor Union v.

ONGC9‖ , the same has no application to the issue involved in the

present case. Therefore, it is difficult to accept the contention of

the petitioners with regard to regularisation of their services or

absorb them in the department.

Learned counsel for respondent No.9 refuting the

contentions of the petitioners placed reliance on the judgment of

the Apex Court in ―Balwant Rai Saluja v. Air India Ltd10‖,

wherein the Apex Court referred to the judgment in ―Ram Singh v.

Union Territory, Chandigarh11‖, as regards the concept of control

in an employer-employee relationship, observed as follows:

―In determining the relationship of employer and employee, no doubt, "control" is one of the important tests but is not to be taken as the sole test. In determining the relationship of employer and employee, all other relevant facts and circumstances are required to be considered including the terms and conditions of the contract. It is necessary to take a multiple pragmatic approach weighing up all the factors for and against an employment instead of going by the sole "test of control". An integrated approach is needed. "Integration" test is one of the relevant tests. It is applied by examining whether the person was fully integrated into the employer's concern or remained apart from and independent of it. The other factors which may be relevant are--who has the power to select and dismiss, to pay remuneration, deduct insurance contributions, organize the work, supply tools and materials and what are the "mutual obligations" between them. (See: Industrial Law, 3rd Edn., by I.T. Smith and J.C. Wood, at pp. 8 to 10.).

2000-Lab IC 2571

(2014) 9 SCC 407

(2004) 1 SCC 126 MSM,J WP_15008_2019

The Apex Court also referred to the judgment in

―International Airport Authority of India v. International Air

Cargo Workers' Union12‖ wherein the expression "control and

supervision" in the context of contract labour was explained by this

Court. The relevant part of the International Airport Authority of

India case (supra), as quoted in Bengal Nagpur Cotton Mills case

(supra) is as follows:

38....if the contract is for supply of labour, necessarily, the labour supplied by the contractor will work under the directions, supervision and control of the principal employer but that would not make the worker a direct employee of the principal employer, if the salary is paid by a contractor, if the right to regulate the employment is with the contractor, and the ultimate supervision and control lies with the contractor.

39. The principal employer only controls and directs the work to be done by a contract labour, when such labour is assigned/allotted/sent to him. But it is the contractor as employer, who chooses whether the worker is to be assigned/allotted to the principal employer or used otherwise. In short, worker being the employee of the contractor, the ultimate supervision and control lies with the contractor as he decides where the employee will work and how long he will work and subject to what conditions. Only when the contractor assigns/sends the worker to work under the principal employer, the worker works under the supervision and control of the principal employer but that is secondary control. The primary control is with the contractor.

Finally, the Apex Court concluded that ―the workers engaged

by a contractor to work in the statutory canteen of a factory would

be the workers of the said factory, but only for the purposes of the

Act, 1948, and not for other purposes, and further for the said

workers, to be called the employees of the factory for all purposes,

they would need to satisfy the test of employer-employee

relationship and it must be shown that the employer exercises

absolute and effective control over the said workers.‖

(2009) 13 SCC 374 MSM,J WP_15008_2019

Thus, the judgment relied on by the learned counsel for

respondent No.9 in ―Balwant Rai Saluja v. Air India Ltd‖

(referred supra), is contrary to the law laid down in other

judgments relied on by the petitioners. As discussed in the earlier

paragraphs, it is clear that the petitioners were not directly

engaged by the respondent Nos.4 to 11, but their services were

engaged by the contractors-respondent Nos.12 to 15. Even if to

consider the petitioners as employees, necessary tests laid down by

the Supreme Court regarding determination of relationship of

employee and employer has to be applied and examined the issue.

In view of my foregoing discussion, as per the judgment of

the Apex Court in ―Dena Nath v. National Fertilisers Limited‖

(referred supra), at best, the petitioners may approach competent

labour Court or Industrial Tribunal for appropriate relief while

holding that the petitioners are not entitled to claim absorption as

there is no relationship of employee and employer between the

petitioners and respondent Nos.5 to 11. This finding is recorded for

limited purpose for deciding the present issue while leaving it open

to the petitioners to raise such contention before appropriate

Labour Court or Industrial Tribunal and on raising such

contentions, the competent Labour Court or Tribunal is under

obligation to decide the issue notwithstanding the prima facie

finding recorded by the Court. Accordingly, the points are

answered.

P O I N T No.3:

In view of my foregoing discussion, it is difficult to extend

minimum time scale to the petitioners as they were not engaged by MSM,J WP_15008_2019

respondent Nos.4 to 11 either on contract basis or outsourcing

basis. But the learned counsel for the petitioners relied on the

judgment of the Apex Court viz., ―State of Punjab v. Jagjit

Singh13‖, judgment of this Court in ―Janapareddy Surya Narayana

v. The Municipal Administration and Urban Development

(W.P.No.25434 of 2020)‖ and the judgment of the High Court for

the State of Telangana in ―G.Srinivasa Chary v. The State of

Telangana (I.A.No.01 of 2019 in/and W.P.No.47675 of 2018)‖.

So far as the judgment of this Court, it is only pertaining to

outsourcing employees distinguishing the judgment of the High

Court for the State of Telangana in ―G.Srinivasa Chary v. The State

of Telangana‖ and considering the judgment of the Apex Court viz.,

―State of Punjab v. Jagjit Singh".

The petitioners made a claim for payment of minimum time

scale from the date of their joining as they are working since long

time and they are discharging duties on par with regular

employees. But the petitioners themselves admitted in the petition

that they made payment of wages claim No.22 of 2009 for

Rs.6,74,900/-, claim No.04 of 2011 for Rs.75,19,492/- and claim

No.03 of 2011 for Rs.1,51,85,201/- before the Joint Commissioner

of Labour, Eluru and the Joint Commissioner of Labour, Eluru

passed orders for payment of minimum wages as claimed by the

petitioners, which are the subject matter of W.P.No.4000 of 2010

and W.P.No.27473 of 2012 pending for adjudication on the file of

this Court. As the claim is sub judice, this Court cannot issue any

such direction for extension of minimum time scale to the

petitioners. The petitioners intend to take advantage of judgment of

AIR2016SC5176 MSM,J WP_15008_2019

the High Court for the State of Telangana in ―G.Srinivasa Chary v.

The State of Telangana (I.A.No.01 of 2019 in/and W.P.No.47675 of

2018) and another judgment of this Court in ―Janapareddy Surya

Narayana v. The Municipal Administration and Urban

Development (W.P.No.25434 of 2020). But those two judgments are

not useful for the purpose of deciding the claim of the petitioners

for the present as the Joint Commissioner of Labour, Eluru already

passed an award for minimum wages in three different claims

(referred supra) and it is the subject matter of W.P.No.4000 of 2010

and W.P.No.27473 of 2012 pending for adjudication on the file of

this Court. When the matter is pending in writ petitions, this Court

cannot decide such issue in the present writ petition. Hence,

leaving it open to the petitioners to raise all these contentions

regarding extension of minimum time scale etc., the claim of the

petitioners for minimum time scale is rejected.

In view of my finding on point No.3, the writ petition is liable

to be dismissed.

In the result, the writ petition is dismissed. However, liberty

is granted to the petitioners to raise all the contentions before

appropriate Labour Court or Industrial Tribunal and on such

contentions, the competent Labour Court or Tribunal is under

obligation to decide the issue notwithstanding the prima facie

finding recorded by this Court. No costs.

The miscellaneous petitions pending, if any, shall also stand closed.

_________________________________________ JUSTICE M. SATYANARAYANA MURTHY 08.02.2022 Ksp